i think the fair middle ground, both for the public and politically, is to make it dischargeable in bankruptcy but have the universities that got the money cover it.
Instead of taxing the general public to pay for the decisions of a wealthier subgroup, which, as you pointed out, isn’t fair, the money comes from the institutions that easy lending policies ultimately subsidized to begin with.
Bankruptcy is difficult to abuse, since countless powerful institutions have had incentives to make it so for years. People who are doing alright but just want a subsidy won’t take the money, but people whose lives are genuinely in shambles can get back on their feet.
It incentivizes competence rather than poor decision-making. Universities that produce successful students won’t pay any price at all, whereas irresponsible ones that take the tuition money and just go through the motions will, rightly, be punished for the years worth of opportunity cost they impose on society.
Universities who want to avoid this have all of the means necessary to do so, given that they have enormous latitude, compared to other organizations, to control who is admitted to their programs. The skyrocketing enrollment rate has raised valid concerns about people who shouldn’t be in college going anyways and wasting four years of their lives for a negligible increase in productivity, if any at all. If universities had to pay back the lenders when their students defaulted, they would be much less willing to admit remedial maths students to STEM programs, for example.
i think the fair middle ground, both for the public and politically, is to make it dischargeable in bankruptcy but have the universities that got the money cover it.
Instead of taxing the general public to pay for the decisions of a wealthier subgroup, which, as you pointed out, isn’t fair, the money comes from the institutions that easy lending policies ultimately subsidized to begin with.
Bankruptcy is difficult to abuse, since countless powerful institutions have had incentives to make it so for years. People who are doing alright but just want a subsidy won’t take the money, but people whose lives are genuinely in shambles can get back on their feet.
It incentivizes competence rather than poor decision-making. Universities that produce successful students won’t pay any price at all, whereas irresponsible ones that take the tuition money and just go through the motions will, rightly, be punished for the years worth of opportunity cost they impose on society.
Universities who want to avoid this have all of the means necessary to do so, given that they have enormous latitude, compared to other organizations, to control who is admitted to their programs. The skyrocketing enrollment rate has raised valid concerns about people who shouldn’t be in college going anyways and wasting four years of their lives for a negligible increase in productivity, if any at all. If universities had to pay back the lenders when their students defaulted, they would be much less willing to admit remedial maths students to STEM programs, for example.